08 Aug Light at the end of the Tunnel

Recent amendments to the Family Provision Legislation saw a legislative clawback of the class of eligible applicants seeking to challenge a will. Under the previous legislative scheme, there was no defined category of eligible applicants, which effectively meant that any person could apply to the Court for provision from of a deceased estate provided they could demonstrate the deceased had a responsibility to financially provide for them. Amendments to the Administration and Probate Act 1958 introduced a class of eligible beneficiaries designed to curtail an alleged significant number of frivolous Applications.

Fortunately, Parliamentary truncation of the previously wide window of potential claimants has not translated into dwindling payouts for new applicants who fit within the latest category of eligibility and can show the deceased had a moral duty to provide for them at death.

In the first case to be judicially determined under the newly amended Part IV legislation, Justice McMillan awarded the Plaintiff, an adult daughter of the deceased left out of her mother’s Will, $170,000 plus her legal costs to be paid out of the Estate.

In determining the case under the new legislation, Her Honour first examined whether the Plaintiff was required to satisfy the dependency requirements under s91(2)(b) of the Act. Given the Applicant was a child of the deceased and therefore an eligible person under the Act, she was not required to prove dependency on the deceased. Given the Executor, the Applicant’s brother, conceded at trial that the deceased had a moral duty to provide for his sister, the question for the trial was then simply a question of quantum.

In addressing the question of what amount of provision should be made, Her Honour ruled the Court must still maintain a distinction between “adequate” and “proper” provision noting that the Court can make further provision in favour of an Applicant where it is satisfied the deceased failed to make adequate provision for them.

The defining test in these cases still remains one of a moral duty.

Whilst the Court acknowledged it may accept evidence of the deceased’s intentions for not making proper provision (irrespective of whether that evidence is in writing), Her Honour ruled that there was no obligation upon the Court to give such evidence greater weight than the question of the moral duty. The Court could also examine evidence which showed that the reasons given by the Deceased were incorrect or misconceived.

The case also serves as a timely reminder to the litigants who have been less than forthcoming in relation of their respective financial positions. The Defendant was found to be an unreliable witness after he claimed he was separated from his wife whilst living under the same roof yet he did not contribute to the financial upkeep of his children. His wife had been receiving a single parent pension for the 10 years (a period in which two of the Defendant’s children were born) which the Defendant claimed to know nothing about, despite giving evidence that his only financial contribution was to the mortgage repayments on the deceased’s home.

Evidence was adduced that the Defendant received undisclosed cash income working as a plasterer between 2013 to 2015 and this income had not been deposed in his affidavit. Her Honour referred the reasons for the judgment to the Deputy Commissioner of Taxation, the ATO and the Minister of the Department of Human Services for an investigation into the Defendant’s financial affairs.

In respect of the Plaintiff’s case, her evidence was that she had always had a close bond and loving relationship with her mother, having cared for her during her mother’s losing battle with cancer. The Plaintiff also questioned the alleged costs of the funeral and mausoleum being claimed by her Defendant brother (whom the Court ruled as an unreliable witness), as well as the costs of upkeep and maintenance of the deceased’s house. Her Honour was ultimately satisfied that the Plaintiff daughter had strong bond with her late mother despite what was written in the deceased’s Will.

Her Honour did state the role of the Court was not to ensure a fair distribution or equality amongst surviving claimants but rather to only ensure that adequate provision is made for the proper maintenance and support of an applicant.

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